Staff Reporter

This follows recent profit warnings and the resignation of former chief executive Darren Ridge.

KJCs corporate offices in Swaythling have been shut down as the first casualty of the review. The corporate sales team has been relocated to KJCs mail order centre at Lee-on-Solent in the interim. Meanwhile KJC is currently consulting with its staff at the Fareham distribution centre over the future of the premises and their jobs. A decision is expected within a month as to whether it will be closed and whether staff can be relocated.

We are reviewing the future of all the premises within the mobile business that are not mobile phone shops PNC marketing director Crispin Thomas told Mobile News.

Jobs are not necessarily under threat. We are carrying out a consultation with staff. It is possible staff may be relocated to other locations where we could run our distribution centre. We have shops that have lots of spare room for staff and other activities.

The review and Ridges departure have caused unrest among some KJC staff. They say Ridge has been made the scapegoat for PNCs poor financial performance. At least three staff from KJCs business division including national sales managers have left. However Thomas (Cont P2) scotched the claim saying: Darren Ridge was not a scapegoat. His decision to resign came after the company put out further profit warnings.

Some staff close to Darren Ridge have left the company because they felt they didnt want to work for different management said Crispin Thomas.

PNC recently appointed Ian Gray as its new chief executive.

Gray has had experience as chairman and chief executive with a variety of public and private companies.

In an exclusive interview with Mobile News Caudwell said:

I havent had an e-conversation with Hutchison. Ever. At all. Neither have I spoken with their representatives or with their representatives representatives to do with selling any of my businesses.

I dont know how the rumours started but I am astonished by their persistency. I have made so many denials. Despite that everybody thinks Ive sold.

The price quoted is a fair price. It is one I could live with. Though with the growth we are achieving in Phones 4U it very soon wont be fair because we are making the business more and more sophisticated by the day.

We have not been talking to anybody about selling our businesses. My objective all along is and always has been to grow Caudwell Group into the biggest company I can make it headed up by the best management team there is.

That means it is there for the long term. My ambition is that if I retire the management team in place will be strong enough to take the group forward.

Caudwell hinted that the Group may eventually go public.

And at that point we (Cont P2) might see a more traditional institutional management-type scenario come into play. Im trying to build a business thats here until eternity.

Were there any circumstances under which he would contemplate selling individual components of the Caudwell Group or the entire Group itself on a private basis?

My number one ambition is to build a lasting business. But there is something that overrides even that. In furthering that ambition I must never deplete shareholder value. I wont stick with any individual business just to grow Caudwell Group turnover he told Mobile News.

Browns successor is Ukko Lappalainen who is moving over from Nokias Networks customer business team in France. Brown took up the role as UK managing director from Isto Pankakoski in late 1999 after six years marketing the Nokia brand in Europe.

Brown will be looking after Club Nokia and all the services that it sends over the air to Nokia handsets.

Nokia recently announced slower sales performance in Q1 showing a seven per cent decrease in mobile phone sales in relation to the same period last year.

However Nokia predicts a five per cent rise in sales for Q2 and the second half of this year.

See Nokia story this page.

However the contract will be fairly restrictive and 20:20 will not be allowed to undercut distributors who are being supplied by other Orange distributors.

We are looking for incremental business following the consolidation in the market and we are giving ourselves the best opportunity to do this. We have ignored the Caudwell Group for too long said Orange sales director Stuart Henry.

The deal brings to a conclusion a long-running feud between Caudwell Group and Orange based on a mutual dislike between ex-Orange group sales director Gareth Jones and John Caudwell.

It was generally acknowledged throughout the industry that the two men couldnt stand one another.

Jones left Orange a year ago. He recently re-entered the mobile industry as a board director of online handset distributor Mloop (Mobile News April 18).

Cellphone Warehouse had over 25 stores. It is understood to have ceased trading after all its shops closed two weeks ago.

It is unconfirmed whether the company is now in the hands of liquidators. The extent of any debts and whether the 67 staff have been made redundant are also unclear.

The Cellphone Warehouses accounts for 2000 to 2001 show that chain made healthy profits of just under 1 million after tax and opened new branches within Asda supermarkets.

The Cellphone Warehouse also planned to expand its stores into mainland Europe in preparation for a public listing in 2003 in spite of the downturn.

Meanwhile calls to Miracles head office were unanswered and the companys trading offices have been closed for a number of days.

A number of directors resigned within the last few months. One ex-director told Mobile News he had been brought in to try and raise extra cash for the business but resigned when accountants told him it was futile.

Newcastle-based Cityphone has put a bid in and is currently carrying out due diligence. But bids from other suitors have also been made reports Bard Covington.

European Telecom declined to either confirm or deny that it was selling off its PCN business.

European Telecom chief David Mc Kinney told Mobile News in February that the company was always looking at different aspects of the business and how it can reduce costs.

It has been suspected for some time that European Telecom wanted to extricate itself from handset distribution to concentrate on (Cont P2) handset configuration and fulfilment for manufacturers. In January it signed a three-year deal to configure and distribute Philips handsets in Europe in a deal worth 300000.

The company has been looking to sell off all parts of the business not related to fulfilment and distribution of cellular equipment. In August last year it sold its 50 per cent stake in Global Telematics for 6 million.

Last September it shut down its Slough HQ and made 50 staff redundant in a bid to cut costs after running up losses of 27 million.

At the time of going to press European Telecoms share price was at an all-time low of 4p.

The stores to be closed are the smaller kiosk-sized ex-PocketPhone Shops. Around 100 shop staff will be affected. But it is not yet clear how many people will be made redundant. One 2 One (which will be officially renamed T-Mobile this week) hopes to relocate staff.

One 2 One closed 23 unprofitable stores last year.

Thus it has shut nearly a third of the 167 shops it purchased almost two years ago for 73 million from PocketPhone Shop founders Simon Jordan and Andrew Briggs. (Cont P2)

One 2 One denies this means that the purchase of PocketPhone Shop was a disaster. One 2 One external relations manager Patrick Barrow says a change in the market forced the closures.

The shops suited our requirements at the time of the purchase. Nothing is set in stone in business. We still have a clear retail strategy. We want the right stores in places where we will get the right people through the doors to buy our products and services.

The strategy is still on track and we will be opening bigger and better stores in due time. In some cases the stores were not attracting the customer profile we are aiming for.

Only last year One 2 One rebranded 136 PocketPhone Shops with joint One 2 One and T-Mobile branding and renamed the company One 2 One Retail Ltd. Earlier this year One 2 One retail managing director Andrew Fryatt quit following the decision to incorporate One 2 One Retail into the main business and run the shops directly.

PocketPhone Shop was also found to be the least favourite place people would go to buy a mobile phone in December last year according to the results of a survey commissioned by ICM Research.

Of the 1000 adults interviewed only 80 thought PocketPhone Shop would give the most honest advice. Nine per cent thought PPS would offer the best choice. Just six per cent thought PPS would have the best prices while 10 per cent thought PPS would have the most knowledgeable staff.

Speaking exclusively to Mobile News in a rare interview Edmonds said:

To accuse me of being naive demonstrates a naivety on the part of those making the accusations. No ones ever made any such allegations to my face.

Im quite happy to invite anyone who feels that way into my office to discuss why they think as they do.

Lets take a look at what Ive done in the last six months.

I produced the Review of the Mobile Market. Is that a naive document?

No. It is a penetrative analytical piece of work that takes the economics of the mobile market down to first essentials and builds up a case as far as most of that marketplace is (Cont P2) concerned for not making it subject to regulation.

That review led directly to mobile operators being able to offer a wider range of product without in the vast majority of cases that product being subject to any price regulation. Was that naive?

No it was a huge step forward.

Where did I step in to regulate? I intervened over calls to mobiles because there was conclusive evidence that the prices being charged are very much higher than should have been the case.

Thats not naive. It is taking action after a thorough appraisal of the facts and the market concluded Edmonds.

The boy Michael Austin was given the phone as an exchange unit which Carphone Warehouse obtained in good faith from Club Nokias Merryhill service centre.

Mobile News recently exposed a loophole in Club Nokias procedures which potentially allowed faulty stolen handsets to be exchanged for new units.

This was because some Club Nokia service centres did not ask customers for proof of purchase on handsets less than 15 months old (Mobile News February 18).

The Carphone Warehouse issued an apology saying:

The Carphone Warehouse would like to again apologise sincerely to Michael Austin and his family for this very unfortunate incident.

The Carphone Warehouse received the exchanged handset in good faith from the manufacturer and had no reason to believe that it had been stolen.

This incident has highlighted a loophole within the mobile phone industry.

There is currently no central database that records blacklisted and stolen handsets and until this is set up this situation risks reoccurring.

The Carphone Warehouse is willing to take on the cost and management of such a database and has been urging the networks to urgently work with us to make this possible.

We have already made considerable progress with two networks and urge the other networks to start working with us on this as soon as possible.

The vending machine is due to be trialled next month in the forecourt of a Texaco petrol station. If the trial is successful the machines could be installed at other Texaco stations nationwide.

The vending machine accepts credit cards and currency in pounds and euros. The machine authenticates card transactions by connecting over Vodafones GSM and GPRS networks to the banks. Phone Kiosk hopes to sell the machines into other retailers and operators.

Telement teamed up with Phone Vending to adapt the design of the pre-pay voucher vending machines it supplies to operators and retailers so that it can handle mobile phone accessories and pre-pay mobile phones.

The machine could also dispense the new wave of disposable mobile phones coming into the UK this year.

Priman says the only way retailers will make any money out of low-margin goods is to automate the sale.

Margins on accessories are getting lower and it makes sense to sell them through a machine rather than over-the-counter. Its not cost-effective to have a member of staff on hand to sell low-margin goods that could be dispensed from a machine at a lower cost.

Priman says he conceived the idea while working at the Pau brothers former FoneRange company prior to its liquidation and the sale of its brand name and customer base to Elite.

Three years ago (former) FoneRange launched a concept accessory vending machine at CeBIT. There was a tremendous response to it but it never came to market. The concept was principally my idea and I was in charge of the project.

It is a good concept because there is less margin on a number of products especially top-up vouchers. It is hardly worth retailers selling them for such a low margin.

If you can automate the retailing process it is an excellent opportunity. And the machine will operate 24 hours a day seven days a week Priman says.